I know in other SE sites, there are law-specifc questions that get closed for either being too localized (not everyone is a lawyer, or not many people from the region), and I realize there is a question about "region specific" questions. But law specific questions, such as how to write a contract for xxx region, or is xxx allowed? Should these questions be encouraged?
How to write contracts is probably a no-no from my point of view, because not everyone is a lawyer. Advice on contracts, however, is encouraged.
When you get into the specifics of the law, it is intertwined with freelancing. You are often self-employed (when not with an agency), and so legal matters that are commonly dealt with by others (who are experienced and capable enough to respond) can be answered.
As for encouraging law-specific questions, I would vote against this, and leave the questions to come naturally with freelancing. Questions involving law will usually be answered by experts, who will then give guidance and a disclaimer, though, so I look forward to seeing what others think.
For region specific questions, In the current (private) beta, there's a very high chance that no two people are from the same place. However, this isn't what the too localized close reason means. "Too localized" would be "There's a giant purple dinosaur outside my house, what do?", not a well thought out question. The simple mention of a location does not mean a question is Too Localized.
There are many issues with law-specific questions. First, laws generally require specialized experts to interpret those laws; specifically, they require lawyers. Second, laws may be specific to a certain area or may be preempted by laws at different levels of government. This increases the chances that two people are less likely to have the same problem that is solvable with the same answers.
Third, there may be only slight differences between the details of one person's problem and another person's problem who finds the site from a Google search. These differences may be significant enough to make those answers incorrect or even detrimental, and it may not be possible for the layperson to determine whether or not the answers apply to them based on their inability to determine if the law applies in their specific circumstances.
This is pretty much what the too localized close reason is about -- situations that are so specific to one person to where they're not likely to be useful to others.
However, many issues do loosely relate to law but don't necessarily require a lawyer to answer, so we shouldn't necessarily close questions simply because a lawyer could be involved. We should ask whether another person could have that problem and if it's easy to tell if another person's situation would apply before deciding to close the question.
Because of their nature, these types of questions will probably need to be validated in some manner other than by simple voting. On the Workplace SE, the community proposed the idea of the back it up rule where users posting such answers include references to back up their answer or experiences that happened to them personally. The side-benefit is that answers end up explaining both how and why, which helps make them easier to understand and learn from.
Without a doubt, Legal Questions are going to be a fundamental part of this site - because so much of freelancing involves legal matters.
Some, we (as non-legal peeps) can answer helpfully... many we cannot. The former have a place, the latter do not.
Having said that, readers of the site have to realise that most of us are not legally trained, so should treat answers with caution - but equally, all answers should be backed-up with facts (eg links/quotes from primary sources), not just opinion, so a reader can judge the merits (or otherwise) for themselves.
I think law-specific questions should be welcome here, if not encouraged per se. This site is explicitly "For self-employed and freelance workers.", and I can't imagine how either named party would be able to function as such without a good deal of legal consideration. That legal consideration may not be expert (as in, of the same quality one might find from a lawyer), but I think it is much more important for either named party to need to seriously consider legal issues than it would be for people who are strictly employees of someone else.
If there are people in this community who are not lawyers but who have already considered many of these legal issues (or perhaps even suffered the consequences of early legal decisions), then I think input from such people would be extremely valuable to those who have not yet faced the same concerns. This is the power of community, and having a community "For self-employed and freelance workers" where legal questions were off-topic seems to me like it would leave a gaping hole in an area of knowledge that is essential to both named groups.
I think this question would better be thought of as "where should we draw the line" regarding legal questions.
I would suggest looking at legal questions as falling in two broad camps-- specifics and generalities:
Those dealing with specifics should be off-topic as too localized. Many of these are fact-dependent, and really if someone needs legal advice a lawyer is the right person to ask. Questions might involve things like "is claiming copyright to all the work I did for them. Here is the relevant portion of my contract. How should I go about responding to this?" The answer is "hire a lawyer."
those dealing with generalities may or may not be too vague, but I don't think they should be categorically discouraged. Things like "how formal should a contract be?" or "Should I include scope of work in the contract?" are both good questions in this category. "What kind of business entity should I choose?" is probably too vague or overly broad.
Secondly while much of this is somewhat country-specific, not all of it is. Basic business functions of contracts are not that different around the world and despite there being large formal variations in copyright law worldwide, the overall goals and concepts are reasonably constant (the lines of what is protected or allowed vs not may not be however!) and so general answers for general questions may be possible.